Citigroup analysts predict that due to OPEC's recent decision to postpone production cuts and the continued suspension of Libyan oil exports, there will be a seasonal oil market shortage of approximately 400000 barrels per day in the fourth quarter of 2024, which may provide some temporary support for Brent crude prices in the range of $70-75 per barrel.

However, Citigroup warns that as the global oil supply and demand balance deteriorates in most scenarios by 2025, it is still expected that there will be new price weakness in 2025. Due to the excess production capacity of 1 million barrels per day, the price of cloth oil will drop to $60 per barrel.

Goldman Sachs pointed out in a report released earlier that although oil prices may rebound in the short term, the crude oil market may face more challenges in the long run.

Goldman Sachs mentioned in its report that due to deteriorating global growth expectations and the spread of recession fears, the market's expectations for oil demand for the next six months have decreased by nearly 1 million barrels per day.

Standard Chartered Bank's commodity analysts are more optimistic about the outlook for oil prices. Standard Chartered predicts that if OPEC+oil producing countries keep their promises, there is unlikely to be a supply surplus at least in the fourth quarter of 2024 and the first half of 2025.

Last week, Standard Chartered Bank reported that the oil market has overlooked the reality that there will be more oil outflows from the market in the coming months. In July of this year, Russia, Iraq, and Kazakhstan submitted compensation plans for excess crude oil production for the first six months of 2024 to the OPEC Secretariat. According to OPEC data, all excess production will be fully compensated within the next 15 months until September 2025, with Russia "compensating" 480000 barrels per day, Iraq "compensating" 1.184 million barrels per day, and Kazakhstan "compensating" 620000 barrels per day.

Standard Chartered Bank has calculated that if all commitments are fulfilled, OPEC's production will decrease by 530000 barrels per day in the fourth quarter of 2024, 540000 barrels per day in the first and second quarters of 2025, and 560000 barrels per day in the third quarter of 2025, in addition to the recently announced reduction due to the postponement of production cuts and compensation plans.

Brent crude oil daily chart